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The Chicago Board Options Exchange, preparing for a long-anticipated stock market float, is facing a $300m (€240m) damages claim from a rival in a patent infringement case.

The International Securities Exchange is seeking $300m or more in damages after suing the Chicago exchange operator for alleged copying of its trading technology, according to a recent court filing.

The CBOE and the ISE have sparred for almost four years over intellectual property and trading rights, sparking a series of suits and counter-claims.

The ISE's May 7 filing comes as part of its opposition to a motion for summary judgement in the patent case in favor of a jury trial that if granted would start in January 2011.

The damage estimate comes on the eve of a key vote by the CBOE's member-owners as the largest US options platform by volume presses forward with a plan to raise $300m by listing a minority stake on the Nasdaq Stock Market.

ISE first alleged in November 2006 that key aspects of the CBOE's hybrid floor and screen-based trading system infringed upon patents on automated trade held by the all-electronic ISE.

"We are highly confident in the merits of this case and believe that our legal filing speaks for itself," said an ISE spokeswoman, who declined to comment on specifics of the issue.

In an April court filing, CBOE argued that its hybrid system does not meet the definition of "automated exchange" as laid out by the ISE. CBOE said that unlike fully computerised exchanges, trades are matched and/or allocated on its physical trading floor.

CBOE is moving toward a public float after paying $4.2m last December to settle a four-year civil suit related to ownership rights in the exchange.

Regulatory filings ahead of the planned IPO highlight a number of ongoing legal issues, including the patent infringement dispute with the ISE.

ISE has been pursuing separate legal action aimed at loosening the CBOE's exclusive hold on licenses to trade options tied to major stock indexes such as the S&P 500, with arguments in that case set for May 26. Dow Jones, publisher of this newswire, is no longer a defendant in that case.

The $300m damage assessment in the patent dispute was calculated for ISE by external counsel, and a person familiar with the situation said CBOE was not compelled to include the estimate in regulatory filings tied to its initial public offering.

Should the ISE win in court, damages could theoretically go as high as $900m if the patent infringement was found to be willful, according to Daniel Ravicher, a law professor and executive director of the nonprofit Public Patent Foundation.

But Ravicher said the damages sought by the ISE appeared lofty. "The momentum in the law is to decrease the amount of patent awards," Ravicher said, adding that the number of findings of willful patent infringement has gone down in recent years.

The latest ISE filing argued that the indicative value of CBOE - which it says is around $2.5bn - reflects "CBOE's long infringement of the [ISE] patent." It said the planned flotation would see CBOE member-owners "unjustly enriched at ISE's expense."

The size of the planned IPO, according to the ISE filing, also is no coincidence, as "the actual damages calculated by ISE's expert are in the $300m dollar range (before enhancement for willful infringement.)"